US investment houses are very bullish on Tower Semiconductor Ltd. (Nasdaq: TSEM; TASE: TSEM) (which is branded as TowerJazz). Zacks Investment Research and Chardan Capital Markets both give the independent foundry a "Buy" recommendation at target prices substantially above Monday's closing price of $1.09 on Nasdaq, after the company raised its revenue guidance for the second quarter.
Zacks is the more enthusiastic, reiterating its target price of $4 for Tower, a 263% premium on the current price. Chardan reiterated its target price of $2.75, a 150% premium. Chardan also raised its 2011 revenue forecast for Tower to $634.4 million from $586.2 million, and raised its 2012 forecast to $856.4 million from $791.8 million. It left its earnings per share forecast for 2011 unchanged at $0.43.
Tower raised its second quarter revenue guidance to $136-142 million following its acquisition of the Japanese fab of Micron Technology Inc. (NYSE: MU) for $40 million in cash and 20 million in Tower shares. The analysts' revenue consensus is $133 million.
Tower's share price rose 0.9% yesterday on Nasdaq to $1.10, giving a market cap of $297 million, and rose 4.9% by early afternoon on the TASE today to NIS 3.88.
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